Income Tax Slabs in India

Section 80C allows deduction of up to ₹1,50,000 for investments and expenses made in specified instruments.

Section 80D provides deduction for health insurance premiums paid for self, family, and parents.

Section 24 allows deduction on interest paid on housing loans for self-occupied and let-out properties.

The old tax regime offers higher tax rates but allows various deductions and exemptions under Chapter VI-A (like Section 80C, 80D, etc.) and other benefits like HRA, LTA, etc. The new tax regime introduced in Budget 2020 and modified in Budget 2023 offers lower tax rates with more slabs but eliminates most deductions and exemptions. From FY 2023-24 onwards, the new regime is the default option, but taxpayers can still opt for the old regime if it's more beneficial for them.

The choice between tax regimes depends on your individual financial situation. Generally:

• The old regime is typically better if you claim significant deductions and exemptions (more than ₹2.5 lakhs approximately).
• The new regime may be better if you don't have many eligible deductions or prefer simplicity in tax filing.

You can use our Income Tax Calculator on this page to compare both regimes based on your specific income and deductions to make an informed decision.

Yes, but with some conditions:

• Individuals with no business income: Can switch between regimes every year without restrictions.
• Individuals with business income: Once they opt for the new regime, they can switch back to the old regime only once, after which they can't opt for the new regime again unless they cease to have business income.

It's advisable to evaluate both options each year based on your financial situation and choose the one that results in lower tax liability.

Standard deduction is a flat deduction from salary income that replaces the earlier transport allowance and medical reimbursement. Key points:

• Amount: ₹50,000 per year
• Eligibility: Available to all salaried individuals and pensioners
• Availability: Can be claimed under both old and new tax regimes
• No documentation required: It's automatically applied when filing returns

This deduction is particularly beneficial as it's available in both tax regimes and requires no proof or documentation.

Section 87A provides a tax rebate for resident individuals with lower income. Current provisions:

• Old Regime: Rebate of up to ₹12,500 for individuals with total income up to ₹5 lakhs
• New Regime: Rebate of up to ₹25,000 for individuals with total income up to ₹7 lakhs

This rebate is applied after calculating tax liability but before adding cess. It effectively makes income up to ₹5 lakhs (old regime) or ₹7 lakhs (new regime) tax-free. However, if your income exceeds these thresholds even by ₹1, the entire rebate becomes unavailable.

Late filing of income tax returns attracts penalties under Section 234F:

• If filed after the due date but before December 31: ₹5,000
• If filed after December 31 but before March 31: ₹10,000
• For taxpayers with income up to ₹5 lakhs: Maximum penalty of ₹1,000

Additional consequences of late filing include:

• Interest under Section 234A at 1% per month on unpaid tax
• Loss carry forward restrictions (except house property loss)
• Delayed tax refunds